Where is NLNG dividend?

T****he dispute between the Federal Government and Oyo State Governor Seyi Makinde over Nigeria LNG Limited (NLNG) dividends has brought renewed attention to the management of the country’s gas revenues, the distribution of proceeds to states and local governments, and questions over whether all funds due to the subnational governments have been fully accounted for, Daily Trust reports.

The controversy bothers on two positions: the Presidency’s assertion that the Federation has received $21.5 billion in NLNG dividends over 25 years, and Makinde’s claim that a reconciliation exercise commissioned by the Nigeria Governors’ Forum (NGF) identified an accumulated shortfall of about N9 trillion due to states and local governments.

While the Presidency has maintained that the figures being circulated should be disregarded, the governor insists that the amount represents money owed to the subnational governments over time, rather than a single dividend payment that should be made to each state.

The disagreement has triggered fresh questions about the volume of dividends paid by NLNG, the share accruing to the Federation, the formula used to distribute the revenue and whether historical payments were properly captured in the relevant accounts.

Stakeholders in the energy sector have also raised concerns about documentation, transparency and the need to establish whether the alleged shortfall reflects an accounting discrepancy, an outstanding obligation or a disagreement over the interpretation of the revenue-sharing framework.

Presidency cites $21.5bn dividend payment

In a statement on Sunday, the presidential spokesman, Bayo Onanuga, disclosed that NLNG had paid $21.5 billion in dividends into the Federation Account over 25 years.

According to him, less than $3 billion of the amount has been received since President Bola Tinubu assumed office.

The statement said, “Makinde’s latest claim that the Federal Government is withholding the NLNG dividend windfall is false and should be disregarded.”

According to the Presidency, if each state of the Federation receives N250bn as a “one-off distribution,” that would amount to N9 trillion, excluding the Federal Government, the Federal Capital Territory and the 774 local councils nationwide.

Using the sharing formula of the Federation Account Allocation Committee as a standard, states receive 26.72% of the distributable Federation Account revenue.

The Presidency therefore reiterated that the NLNG has never paid $25bn in dividends to the Federation Account in a single payout.

NLNG’s facts and figures

The dispute comes as NLNG continues to expand its operations and consolidate its position in the global liquefied natural gas market.

At the unveiling of its Facts and Figures 2026 publication, NLNG said it had generated $149.6 billion in revenue since commencing operations, paid $47.2 billion in dividends to shareholders and remitted $10.8 billion in taxes to the Federal Government since becoming tax-compliant in 2009.

Daily Trust reports that NLNG has four shareholders. The Nigerian National Petroleum Company Limited (NNPC Ltd) holds 49 per cent, while Shell holds 25.6 per cent, TotalEnergies has 15 per cent and Eni owns 10.4 per cent.

The Federation’s 49 per cent interest is held through NNPC Ltd. Consequently, the $21.5 billion cited by the Presidency represents the amount attributed to the Federation’s interest, rather than the company’s total dividend payments to all shareholders.

The other shareholders collectively account for the remaining 51 per cent.

How the N9trn shortfall claim emerged

Makinde had disputed the Presidency’s interpretation of the figures, maintaining that the N9 trillion claim relates to accumulated underpayments identified during a reconciliation exercise involving the Federal Government and the NGF.

In his account, the exercise was undertaken to establish the extent of NLNG dividend payments and determine whether the amounts due to states and local governments had been fully accounted for.

The governor said the reconciliation identified a shortfall of about N9 trillion.

He said: “The Nigeria Governors’ Forum (NGF), with the Federal Government’s support, engaged a consultant to reconcile NLNG dividend payments. The exercise identified a shortfall of about N9 trillion due to states and local governments. The Federal Government accepted the findings. The report remains in the custody of both the Federal Government and the NGF.”

On Monday, Makinde insisted that the Federal Government was withholding N250 billion in Nigeria LNG Limited (NLNG) dividends for each state in the country.

What the revenue-sharing formula provides

Section 162(1) of the 1999 Constitution provides for the payment of revenues collected by the Federal Government into the Federation Account, subject to the constitutional provisions governing revenue collection and distribution.

The account serves as the pool from which allocations are made to the Federal Government, state governments and local governments under the applicable revenue-sharing arrangements.

For NLNG dividends attributable to the Federation, the questions being asked include when the proceeds were remitted, how they were recorded and how the distributable revenue was treated under the relevant arrangements.

Observers have argued that the constitutional principle of pooling and distributing revenue should guide the treatment of NLNG dividends, rather than allowing funds due to the Federation to be handled outside the established framework.

NEITI audit raises historical questions

The current dispute has also revived questions about the historical handling of NLNG dividend payments.

An audit by the Nigeria Extractive Industries Transparency Initiative (NEITI) reportedly found in 2015 that $11.6 billion paid by NLNG to NNPC had not been remitted to the Federation Account.

The finding raised concerns about the treatment of the proceeds and whether funds accruing to the Federation had been retained or used for other purposes before being transferred to the account from which statutory allocations are made.

NEITI subsequently confirmed that NNPC began remitting the dividends directly into the Federation Account from 2016 or 2017.

Stakeholders fault documentation

An energy stakeholder, Rasheed Adeleke, said the management and distribution of NLNG revenue involved several statutory safeguards, including the constitutional framework, RMAFC, NEITI, FAAC and the National Assembly.

In a chat with Daily Trust, he argued that the structures were intended to ensure that public revenue was properly recorded, accounted for and distributed in accordance with the law.

Adeleke, however, said the current disagreement had been compounded by documentation problems.

He said: “The claim over the existence of N9trn shortfall exists, and the denial by the Presidency showed poor documentation which shouldn’t have reared its ugly head in the first place.”

Also speaking, another oil and gas expert, Dr. Ayodele Oni also said a reconciliation report must be published.

“Neither side has yet produced the documents that would end the argument. The truth is in the dividend ledger, the Federation Account statements and the FAAC schedules.

“In my view, this is a record question dressed up as a political fight. A publication of the reconciliation report will end the dispute,” he said.

Another stakeholder, who asked not to be named, suggested that the exchange between the Presidency and Makinde could have political undertones, given the timing of the dispute ahead of the 2027 general elections.

The stakeholder questioned why the issue had become more prominent only recently, despite the fact that questions surrounding NLNG dividends and their distribution had existed for several years.

“The fact that the crisis didn’t gain momentum several months ago shows there is more to it than meets the eye. The issue had been there before now without much prominence. Why did the two presidential candidates draw battle lines over NLNG dividends a few months before the 2027 general elections?” the stakeholder asked.

Another source familiar with the NLNG told Daily Trust that there has not been clarity over the NLNG dividends payout.

“By the end of Buhari’s administration, what was left of the dividend was just hundreds of million dollars. Now under the Tinubu administration, there is no clarity as to whether the dividend is being kept in some account or put into the federation account at all. That may explain the claim of Oyo State governor Seyi Makinde about the NLNG dividend,” he said.